Revisiting Reliance

 

This What we said on 16 Oct 

We posted a question on the Orpheus forum. “Can Reliance save India or Nifty?”. The popular answer was ‘Yes’ it can. We put the question up for a few reasons. First, Reliance is the top weight in Nifty. Second, we live in an Oil economy. Third, a stock cannot remain sideways for eternity. Q1 2012, Reliance would complete 36 months of sideways action. Any fall below 700 will take the stock to 2009 lows.

Reliance is back to 700 prices. A break here would suggest further negativity. We have a running short on Reliance. We have reviewed all short ideas. Ranbaxy has pushed above review levels. We are closing the running short on Ranbaxy. Rest shorts continue to run. On the pair side our long idea TATA Motors delivered 60% since Nov 2011 vs. Reliance a running Short.

Our Jiseki Time cycles are seasonal patterns of strength or weakness in assets. They are derived from percentile rankings from 1 to 100. The higher the percentile more the chance for an asset to weaken and worst the ranking, better the chance for the respective asset to outperform. 100 is top relative performance and 1 is worst performance. The idea is that performance is cyclical. A top performer will underperform in future and vice versa. A top relative performer is also the worst value pick and the top relative underperformer is the best value pick. Jiseki is another name for Performance cycles, time triads and time fractals. The signals are illustrated as a running portfolio and as Jiseki Indices. These signals can be used by fund managers for relative allocations, traders for leverage bets and high net worth clients for selective trades.

Jiseki Interpretation. Signals are interpreted as crossovers between various Jiseki Cycles. All three Jiseki cycles (Jiseki 1,2 and 3) depict different time frames. Example: An asset is ranked above 80 percentile and all the three Jiseki cycles are pointing lower, this suggests a running SHORT SIGNAL. Our Jiseki Indices use different kind of exits based on price and Jiseki Cycles. We have color coded the (Jiseki 1>Jiseki 2) SHORT zones with brown sandy (burlywood) and grey (Jiseki 1>Jiseki2) for LONG SIGNALS.

Avinash Barnwal is Master of Science in Statistics and Informatics from IIT Kharagpur. He has worked on human response time at Department of Psychology, University of Amsterdam.  Avinash is a Quantitative Analyst at Orpheus developing money management solutions and building statistical models to address temporal challenges.


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